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BRAZIL: An Introduction to Dispute Resolution: Arbitration

BRAZIL: An Introduction to Arbitration in Brazil

Pedro Maciel and Bernardo Pires
Lefosse Advogados

Brazil is the largest country in Latin America and one of the greatest recipients of foreign direct investment in the world. In recent years, Brazil’s dispute resolution framework has undergone major improvements to accompany the country’s arrival at the centre stage of the global economy. Arbitration, which is a major part of this framework, plays a key role in promoting a safe environment for business in Brazil and has become the default mechanism for the resolution of complex, high-profile disputes.

An Overview of the Arbitration Market in Brazil 

The Brazilian Arbitration Act (Federal Law No. 9,307, or “Act”) was enacted in 1996, but it was not until five years later that arbitration became a truly viable option for dispute resolution in Brazil. It was only in 2001 that the Brazilian Supreme Court confirmed the constitutionality of the Act, a modern piece of legislation that adopts the best arbitration practices adopted across the globe. In a landmark decision, the Supreme Court ruled that arbitration is compatible with the people’s constitutional right of access to justice and set the stage for the development of arbitration in Brazil.

The arbitration market in Brazil has never looked back since. The ensuing years have witnessed a sharp growth in number of arbitrations and amounts involved. For instance, in the Center for Arbitration and Mediation of the Brazil-Canada Chamber of Commerce (CAM-CCBC), one of Brazil’s busiest arbitration chambers, the number of new arbitrations per year has jumped from 2 in 2001 to a record-high 147 in 2017. By the way, the Brazilian arbitral institutions (CAM-CCBC, CAM-B3, CAMARB, FGV, CIESP/FIESP, AMCHAM, to name a few) have been instrumental to the development of arbitration in Brazil. With their state-of-the-art facilities, well-trained personnel and modern arbitration rules, they have provided a great deal of comfort and encouragement to arbitration practitioners all over the country. The widespread preference in Brazil for institutional arbitration as opposed to ad hoc arbitration speaks volumes to the high quality of the services provided by those institutions.

It is also noteworthy that the Brazilian Judiciary has been very supportive of arbitration. In 2015, the Act was amended inter alia to introduce clearer rules and to strengthen the relation between judicial and arbitral tribunals. The 2015 amendment made it easier for parties to seek assistance from Brazilian courts before commencement of an arbitration. Furthermore, by introducing the “arbitral letter” (carta arbitral), the 2015 amendment has also empowered arbitral tribunals, which now have a more expeditious way to have their orders enforced by judicial courts (through coercive means, if needed). The close ties between arbitral tribunals and the Judiciary even prompted the creation in 2019 of two lower courts in São Paulo – Brazil’s arbitration capital – specialized in litigation related to or in aid of arbitrations. The arbitration courts were created in as early as 2019 and have already proven to be a remarkably successful experience.

Finally, Brazil is consolidating itself as a hub for international arbitration in Latin America. Although Brazil remains reluctant to submit to investor-state arbitration, parties have increasingly perceived Brazil as a convenient seat for their international commercial arbitrations. Many factors contribute to this trend: the existence of a large pool of renowned Brazilian arbitrators able to conduct arbitrations in English (many of whom can also work in Spanish, French and other languages); the support that the Brazilian Judiciary offers to arbitration, which mitigates the risk of legal uncertainty; the world-class job done by the Brazilian arbitral institutions, which are fully capable of administering sophisticated proceedings, etc. Relatedly, an important step toward Brazil’s consolidation as a hub for international arbitration was the opening, in 2017, of the International Chamber of Commerce (ICC)’s office in São Paulo, its first in Latin America. Brazilian parties are among ICC’s most frequent users, having ranked third in ICC’s 2019 statistics; and the ICC’s office in São Paulo has been busy since its opening, with over eighty cases on its docket.

Latest Trends in Arbitration in Brazil 

Energy and infrastructure disputes. The energy and infrastructure sectors have taken centre stage in the efforts by the Brazilian Government to recover the economy following the hit brought by the COVID-19 pandemic. Investments in energy and infrastructure were already booming before the pandemic and continue on the rise, as the Government considers both sectors as key for a speedy recovery of the economy. Due to their complexity, energy and infrastructure projects are knowingly prone to disputes. For instance, the most recent statistics published by CAM-CCBC indicate that energy and infrastructure disputes correspond to 22% of all arbitrations initiated in 2019. And, based on the ever-increasing number of large energy and infrastructure projects all over the country, it seems that the number of disputes tends to grow in the coming years.

COVID-19-related disputes. The COVID-19 pandemic has taken the world by storm and put the global economy into a period of unprecedented distress. In addition to the tragedy of losing millions of people, COVID-19 has had a terrible impact on small businesses and large corporations alike. Unsurprisingly then, the effects of the COVID-19 pandemic on contracts have become a hotly discussed issue all over the world. There are already plenty of cases in which parties have invoked the COVID-19 pandemic as an event of force majeure in hopes of exempting them from their obligations under agreements executed before 2020. As the pandemic unluckily insists on not going away as quickly as we would like it to, new COVID-19-related disputes will certainly continue to appear for the foreseeable future. And arbitration has proven to be a reliable mechanism for resolution of such disputes, with arbitral institutions and tribunals adopting effective protocols for the conducting of online hearings and electronic filing of written submissions.

Capital markets disputes. Over the last few years (and particularly in 2020), the number of individuals trading in the Brazilian Stock Exchange (B3) has skyrocketed. Just in 2020, 28 companies went public – the largest number of initial public offers in over a decade. The bylaws of most of the Brazilian publicly-listed companies contain arbitration clauses providing for mandatory arbitration to resolve disputes between them and their shareholders. B3 even has its own arbitral institution (CAM-B3), which has witnessed a steady yearly growth in the number of cases over the past decade (ranging from the 4 cases initiated in 2010 to the 148 initiated in 2019, according to the most recent statistics publicly available). The intense activity in B3 is likely to result in the emergence of disputes over rights of minority shareholders, brought either by the minority shareholders themselves or by associations representing them.


Discussions as to whether Brazil is an arbitration-friendly jurisdiction are a creature of the past. Once seen with distrust by the international arbitration community, Brazil has developed over the last two decades a robust domestic arbitration market and is consolidating its reputation as a hub for international arbitration as well.